July, 2020

Recently, the writer’s union for the Los Angeles Times made their own headlines when they announced an agreement between the Guild and the paper to avoid layoffs. This solution involved a temporarily reduced weekly schedule.

Typically in times of economic downturns the only remedy available to employers is drastic cost cutting – and as advertising revenues at the Times plummeted, layoffs seemed inevitable. But representatives for the L.A. Times Guild team found a better way:

“We discovered a potent, but little-known, layoff prevention program known as “work-sharing.” Employers who participate in work-sharing can avoid layoffs during a temporary downturn by shortening employees’ hours. Workers maintain health and retirement benefits. Workers can collect prorated unemployment benefits to offset lost wages. Hours are restored when the downturn ends..“

The management team at the Times quickly agreed, preserving 80+ jobs and cutting payroll costs by over $2 million. Guild president, Anthony Pesce, called the outcome “…the best possible deal we could have made under the circumstances.”

State work-share programs let businesses temporarily reduce the hours of their employees, instead of laying them off during financial crises. Often referred to as short-time compensation, the goal of work-sharing programs is to reduce unemployment.

Work-share programs benefit businesses, workers, and states:

• Businesses retain their trained workforce for easy recall to full-time work when economic conditions improve.
• Workers keep their jobs. And collect reduced unemployment benefits to partially replace their lost wages.
• States save money by paying only partial unemployment claims instead of paying full benefits to laid-off workers.

Workforce Development Boards on the front lines of layoff aversion efforts in their communities are in a great position to connect at-risk businesses with work-share resources – and EconoVue™ helps Workforce Boards identify financially at-risk companies before any layoffs have occurred, and to explore creative layoff alternatives like work-share.

Using the EconoVue Employer Risk Indicators to create a targeted outreach focused on small businesses, a Silicon Valley Workforce Board recently connected with an electronic component manufacturer who had lost a big contract. By helping the company apply for work-share assistance, the at-risk employees were able to maintain their employment and benefit status. They did this by working a reduced schedule. As a result, the employer avoided additional financial hardship. The employer also avoided future hiring costs.

A Customer Story

The Board’s Business Services Manager shared her story with us. “Using EconoVue made it easy to identify at-risk companies in our priority sectors. We paired this struggling company with CA Work Share. And reduced the company’s financial stress and helped them retain their employees.”

Learn More about EconoVue

Want to learn more about how EconoVue can help your Workforce Board? Want to identify and connect with companies in your region that are good candidates for work-share? Comment below. Or reach out for more details and a personalized demo.

For more information, visit www.econovue.com.